By Pádraig Hoare
The threat to more than 650 jobs at Aughinish Alumina in Limerick appears to have eased as the US administration significantly softened its rhetoric on its owner Rusal and signalled it wanted to reach a deal.
Shares in Rusal rose 15% in Hong Kong after US treasury secretary Steven Mnuchin said he was open to removing the Russian aluminium producer from a US sanctions list, saying the object of the sanctions was “not to put Rusal out of business”.
The jobs in Limerick have been under a cloud as US sanctions imposed on Aughinish’s owner Rusal played havoc with metal markets over the past four months.
Some 450 staff and around 220 contractors are employed at the plant near Askeaton, which has been described as one of Limerick’s best employers.
Rusal is majority-owned by a company controlled by Russian billionaire Oleg Deripaska, who was targeted because of his purported close ties to the Kremlin.
The US Treasury in April imposed sanctions against Mr Deripaska and the eight companies in which he is a large shareholder, including Rusal, in response to what it called “malign activities” by Russia.
Mr Deripaska has called the sanctions “groundless” but has indicated he would divest his interests in businesses like Rusal.
The US sanctions fuelled volatility in aluminium prices by casting doubt on the future of a major player in the supply chain.
Rusal supplied about 6% of the world’s aluminium and operates mines, smelters, or refineries in locations including the Republic, Guinea, Jamaica, and Russia.
Rusal has since taken a series of steps to try to appease the US Government and get the restrictions lifted.
Last month Rusal shareholders elected a new board of directors, dominated by independent directors and operational managers.
Mr Deripaska and a team of his top managers stepped down from Rusal’s board of directors in May and are currently working on several options to reduce his control over the company.
Several countries and companies worked to successfully lobby Treasury for a softening of the terms on Rusal.
Business Minister Heather Humphreys directly raised Aughinish Alumina with US commerce secretary Wilbur Ross during a visit to Washington in May, while acting US ambassador to Ireland, Reece Smyth, said the US government was closely aware of the situation in Limerick.
Mr Mnuchin said Rusal was important to the global aluminium market, and that the US did not want to put it out of business.
“If we can find an acceptable solution, that is our objective,” said the treasury secretary.
Additional reporting Reuters